After the Bonchon Franchise Agreement terminates, does Bonchon have an obligation to cure any defaults under the lease?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
-|---|---|---|---|---| and such other and further Proprietary Marks (as defined in Section 1.01 of the Franchise Agreement) that we may from time to time license to you in conjunction with and addition to the Proprietary Marks listed above. Any such other and further Proprietary Marks will be deemed a part of this Exhibit B.
EXHIBIT C TO BONCHON FRANCHISE AGREEMENT REQUIRED LEASE RIDER
| 1. | |
|---|---|
| 2. | |
| 3. | |
| 4. | |
| 5. | |
| 6. | |
| 7. | |
| 8. | |
| 9. | CRUNCH OUT LOUD |
| 10. |
-
- Reference is made to the Franchise Agreement (the "Franchise Agreement"), dated _______, 20__, between Tenant and Bonchon Franchise LLC ("Franchisor"), pursuant to which Tenant is a franchisee of Franchisor. After (a) the expiration of the Franchise Agreement (so long as Franchisor provides the Landlord with no less than 60 days advance written notice thereof), or (b) the sooner termination of the Franchise Agreement for any reason (so long as Franchisor either provides the Landlord with (x) a copy of Franchisor's notice of termination to Franchisee or (y) an agreement regarding the date of termination), Franchisor will have the right (but not the obligation) to cure any defaults within a reasonable period of time and at Franchisor's election, either to assume the obligations of and replace Tenant as the lessee under the Lease, or to have another franchisee, licensee, joint venture partner or other designee of Franchisor's assume the obligations of and replace Tenant as the lessee under the Lease.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, Bonchon does not have an obligation to cure any defaults under the lease after the Franchise Agreement terminates. However, Bonchon has the right, but not the obligation, to cure any defaults within a reasonable time frame. Bonchon also has the option to assume the lease obligations and replace the franchisee as the lessee or designate another franchisee, licensee, joint venture partner, or other designee to assume the lease.
If Bonchon assumes the lease and subsequently reassigns it, Bonchon is released from future obligations as the lessee. The landlord is required to provide Bonchon with written notice of any default or termination at the same time they notify the franchisee. This notice must specify the details of the default or termination.
Furthermore, the lease states that the franchisee is solely responsible for all debts, payments, and obligations under the lease until Bonchon or its designee takes possession of the premises. This clause is typically included in franchise agreements to protect the franchisor from liabilities associated with the franchisee's lease obligations, while also providing the franchisor with options to maintain control over the location if the franchise agreement is terminated.